The FTSE 100 was sharply lower again on Tuesday as the global equity selloff accelerated ahead of Nvidia earnings and the return of US data.
London’s leading index was trading down by more than 1% at the time of writing.
“Market jitters are back as traders position themselves to tackle a week centred around NVIDIA’s earnings and the delayed September jobs data,” said Daniela Hathorn, Senior Market Analyst at Capital.com.
“Global equities face another round of selloffs on Tuesday led by the Asian session despite a lack of fresh catalysts, suggesting another round of risk-aversion brought on by positioning.”
Market chatter about a possible AI bubble is rife, and Nvidia’s earnings tomorrow could be a catalyst for further selling or provide the reassurance investors need that the AI trade has further legs. Nvidia has become the most-watched earnings release globally, and the stakes for tomorrow’s release could not be higher.
“As fears over an AI bubble build, there has rarely been more riding on an individual set of results than Nvidia’s on Wednesday,” said AJ Bell investment director Russ Mould.
“Even a mild disappointment could reinforce the market’s worries and spark a wider sell-off.”
The majority of the FTSE 100’s stocks were down on Tuesday, with 89 of the 100 constituents trading in the red at the time of writing.
ConvaTec was the FTSE 100’s top faller after the Novo Nordisk Foundation sold its entire stake in the group, equating to around 7.8% of ConvaTec’s total shares. ConvaTec shares were down 3% at the time of writing.
Weakness in Asia filtered through to more selling of China-focused stocks on Tuesday. Anglo American was down heavily while HSBC and Standard Chartered lost more than 3%.
ICG was the FTSE 100’s top riser, gaining 7%, after announcing that management fees had increased 16% in its first half period.
Imperial Brand was another of the few risers as the group reported that improving demand for tobacco alternatives helped lift profits.
“In the wider market context, what appears a modest advance for Imperial Brands carries more weight,” Russ Moudl explained.
“At a headline level, earnings for the year to 30 September may have been materially lower thanks to higher tax and costs associated with the delivery of its 2030 strategy.
“The underlying picture was better, and investors will have taken note of the solid growth delivered in next-generation products like vapes and e-cigarettes – with losses narrowing.”